Meeting with the Director-General of the Department of Communications to discuss her performance contract for 2012/13

Meeting report

The Chairperson noted the apologies of the Minister of Communications and Members Ms W Newhoudt-Druchen (ANC) and Ms L Van der Merwe (IFP).

Performance contract of the Director-General of the Department of Communications (DOC) for the 2012/13 financial year
The Chairperson welcomed Ms Stella Ndabeni, Deputy Minister of Communications and Ms Rosey Sekese, Director-General of the Department of Communications.

The Chairperson referred to the meeting held by the Committee on 30 October 2012.  The Committee had requested legal advice from the Constitutional and Legal Services Office of Parliament on how to proceed with the matter concerning misleading evidence that was presented to the Committee on the signing of the performance agreement of the Director-General of the Department of Communications.  The issue of whether or not the Director-General had a performance agreement with the Minister in place arose during meetings with the Committee on 10 October 2012 and 16 October 2012.  The Director-General had stated that she had a performance agreement for 2012/13 but this was disputed by the Deputy Minister.  The Parliamentary Legal Adviser had suggested that the Committee called the Director-General to provide an explanation for her statement.  The Director-General had provided Members of the Committee with a set of documents related to the matter.

Ms J Killian (COPE) asked who had compiled the documentation provided to Members.

Ms F Muthambi (ANC) asked why the documents were not circulated to Members prior to the meeting.

The Chairperson advised that the documents were provided by the Director-General.  He assumed that she would refer to the documents when she addressed the Committee.

Ms M Shinn (DA) asked how relevant the documents were.  She had not been able to study the documents in depth but a quick perusal indicated that the documents merely provided background.  In her opinion, the documents did not answer the question whether or not the Director-General had misled the Committee.

Ms Muthambi understood that the documents were provided for reference purposes.  She felt that the Minister should have regarded her attendance at the meeting to be a higher priority than attending a workshop on broadband services.  It was important that the Minister was present during the discussion so that any misunderstanding was avoided.

The Chairperson said that the matter could proceed without the presence of the Minister as the Deputy Minister was present and represented the Ministry.  When the meeting was concluded, the Committee would decide on a recommendation to the Minister.  The Minister would have to act in accordance with the recommendation.

Mr C Kekana (ANC) agreed that the matter should not be postponed.

Ms R Morutoa (ANC) pointed out that the meeting was about the accuracy of the information that had given to the Committee by the Director-General.  She accepted that the Minister was represented by the Deputy Minister and that her presence was not essential.

Ms Sekese thanked the Committee for the invitation to respond to the alleged misleading statement concerning her performance agreement for 2012/13.  Minister Pule was only appointed in October 2011.  She referred Members to the copy of the performance agreement document included in the information pack.  She started to explain the background to the delay in the signing of her letter of appointment and performance agreement but was interrupted by Ms Morutoa.

Ms Morutoa thought that the Committee had made it clear that an explanation was required from the Director-General on the issue of whether or not Parliament had been misled.  The Director-General had told the Committee that she had signed a performance agreement but this was disputed by the Ministry.

The Chairperson said that the Director-General was aware that the existence of the performance agreement was under question.  The Committee wanted to know what the reasons were for making a misleading statement to Parliament.

Mr Kekana suggested that The Director-General proceeded with her explanation and included references to the substantiating documentary evidence where relevant.  She should avoid providing extraneous information that confused the issue.

Ms Sekese denied that she had misled the Committee.  She had a performance agreement for 2012/13.  She had intended to aid the understanding of the Members by explaining the process.

Ms Killian asked the Director-General to refer Members to the documentary evidence in support of her statement.

Ms Shinn did not recall that the Director-General had qualified her statement during the meeting held on 10 October 2012.  No reference to the year was made.  The point could be verified if a transcript of the recording of the meeting was provided to Members.  The Director-General was asked to provide the Committee with a list of officials who had not signed performance agreements.  Her name was not on the list that was provided.  Members of the Committee had queried the omission of the Director-General from the list during the subsequent meeting.  The matter of whether or not the Committee had been misled arose during the following discussion.

Ms Morutoa concurred with Ms Shinn. It would be helpful if documentary evidence was provided.  The matter arose out of the contradictory statements made during the meetings on 10^th and 16^th October 2012.  Members had asked the Director-General if she was aware that she had made a misleading statement to Parliament.

Ms Sekese responded that the discussion on 10 October 2012 was about the 2011/12 fiscal year.  She had confirmed that she did not have a performance agreement for that year.  The discussion on 16 October 2012 was about whether or not she had a performance agreement for 2012/13.

Ms S Tsebe (ANC) wondered why the Director-General did not simply provide evidence of the existence of the 2012/13 performance agreement.

Mr Kekana understood that there had been problems with finalising the performance agreement for the previous year, which had been resolved.  He asked if the Director-General had signed a performance agreement for the current year (i.e. 2012/13).

Mr B Steyn (DA) pointed out that the meeting was being held to discuss the serious allegation that the Director-General had misled a Parliamentary Committee.  He agreed that verbatim transcripts of the previous meetings would clarify what was actually said.  The transcript would allow Members to formulate specific questions to the Director-General.  The performance agreement was a contract between the Director-General and the Minister.  The Minister should be present during the discussion as the other party to the contract.

Ms Killian referred to the finding of the Auditor-General in the Department’s annual report for 2011/12 that the performance agreements for seven senior officials, including the Director-General, could not be found.  During the meeting on 10 October 2012, the Chief Director: Human Resource Management of the Department listed which officials had not signed performance agreements.  At the request of the Committee, the Director-General subsequently provided a list of the officials concerned but the list omitted the name of the Director-General.  Members did not have a Hansard record of the proceedings but had access to the reports of the Parliamentary Monitoring Group (PMG).  She supported the suggestion of other Members that a verbatim transcript of the relevant meetings was provided.

Mr G Schneemann (ANC) said that the Committee was informed during the meeting on 10 October 2012 that the Director-General did not have a performance agreement in place.  The Director-General had ample opportunity to provide an explanation but had not done so.  He observed that the documents provided were not properly signed by both parties.  Recordings of the meetings were available and could be listened to but the Committee could also be informed verbally of what had occurred during the meetings.

Ms Muthambi pointed out that the Committee had sought legal advice on what action could be taken.  The Director-General had stated that she had a performance contract for 2012/13.  She asked if both parties had signed the document.  The Director-General had the opportunity to provide an explanation of the process followed during the earlier meetings.

Ms Morutoa said that the Director-General had stated that the discussion on 10 October 2012 had been on the agreement for the 2011/12 fiscal year and the agreement for 2012/13 was discussed in the meeting held on 16 October 2012.  She agreed that transcripts of the proceedings should be made available to ensure that there was no misunderstanding over exactly what was said.  The Minister should be present during the discussion as she was the other party to the performance contract.

The Chairperson pointed out that the Director-General was appointed with effect from 1 June 2011.  A performance agreement for the period June 2011 to March 2012 should have been in place.  The Auditor-General could not find such a contract.  The Director-General had confirmed that she did not have a performance agreement for 2011/12.  The agreement for the 2011/12 year was not at issue.  Minister Pule had formalised the appointment of the Director-General after she took office in October 2011.  The Director-General had stated to the Committee that she did have a performance contract for 2012/13.  The Deputy Minister was present when the statement was made.  At first, the Deputy Minister had agreed that a performance agreement was in place but later retracted her agreement on the basis that she had been misinformed.  If there was no signed performance agreement for 2012/13, the Director-General had made a misleading statement to Parliament.  In his opinion, verbatim transcripts of the proceedings would not make any difference to what was at issue.

Ms Tsebe asked that proceedings were suspended for a short period to allow Members to caucus and reach agreement on the matter.

Ms Morutoa remarked that Ms Muthambi and Ms Tsebe were not present at the previous meetings of the Committee.  She insisted on transcripts of the meetings as it was important that there was no misunderstanding over which year’s agreement was at issue.

Ms Killian pointed out that the Chairperson had clarified that the performance agreement for the 2012/13 financial year was at issue.  The failure to sign a performance agreement for 2011/12 was discussed during the previous meetings.  Members had asked what the current situation was.  The Deputy Minister had at first confirmed that a performance agreement for 2012/13 was in place but later retracted her statement.  She asked the Director-General if documentary evidence could be provided to substantiate her claim that a performance agreement was in place.  The same document had to be signed by both parties for a valid contract to exist.

Ms Morutoa suggested that the Director-General was allowed the opportunity to provide the necessary documentary evidence.  If the Committee was not satisfied with the evidence provided, Members could hold a caucus discussion on how the matter should be proceeded with.

Ms Ndabeni said that the onus was on the Director-General to furnish proof to substantiate her statement.

Ms Sekese requested an opportunity to respond.

The Chairperson said that Ms Sekese had denied in her earlier response that she had misled Parliament over the existence of a performance agreement for 2012/13.  She could produce documentary evidence to support her statement.  If documentary evidence could not be provided, the Committee required an explanation for the information that was provided.

Ms Ndabeni said that the Director-General had responded that she had not misled Parliament.  All that was necessary was for her to produce the relevant document.  If the document existed then there was a problem with the accuracy of the information provided by the Ministry.

The Chairperson explained that the documents provided by the Director-General had not yet been accepted into the records of the Committee.

Ms Sekese reiterated that she did have a performance agreement for 2012/13 and confirmed that an agreement was not signed for 2011/12.  A copy of the agreement document signed by her on 26 May 2012 was included in the documents provided to the Committee (marked “Annexure F1”).  A copy of the agreement document signed by the Minister on 30 May 2012 was provided as well (marked “Annexure F2”).  In her opinion, she had a performance contract in place.  She chose not to elaborate on the matter during the meeting with the Committee on 16 October 2012 because the Minister was not present.  She regarded the matter to be between herself and the Minister.

Subsequent to the meeting with the Committee on 16 October 2012 and the reports in the media, she decided to obtain advice from Senior Counsel.  The advice given to her verbally was that a valid contract existed if two documents were individually signed by the parties concerned.  The two documents had to be read together.  The written opinion could be made available to the Committee if required.  In her opinion, a valid performance contract for 2012/13 was in existence.  She again affirmed that she did not mislead the Committee or the Deputy Minister during the meeting on 16 October 2012.  She expressed her respect for the Committee and the Deputy Minister.

Ms Shinn referred to the letter from the Director-General to the Minister dated 11 July 2012 (marked “Annexure H3”) included in the documents provided to the Committee.  The letter referred to a difference between the performance agreement document that was signed by the Minister and the document that was signed by the Director-General.  She asked if the difference between the two versions of the performance agreement was substantial.

Ms Muthambi wanted to know why the Director-General had not informed the Committee during the meetings in October that there were two documents, each signed by one of the parties to the contract.  She asked which one of the two documents was the correct contract as the content differed.

Mr Steyn said that his copy of Annexure F2 was not signed by the Minister.  Each page had not been initialed and there were no signatures at the end of the document.  Annexure F1 was only signed by the Director-General.  He disagreed that two separate documents that were individually signed by only one of the parties constituted a valid contract.

Mr Schneemann referred Mr Steyn to page 12 of Annexure F2 where the signature of the Minister appeared.  He agreed that each page had not been initialed.

Mr Steyn was adamant that all the pages in the document were part of the contract.  The Minister’s signature did not appear on page 27 of the document.

Mr Kekana said that there was a problem if the content of the version of the document signed by each party differed.  The Committee had to establish whether or not the action that was taken had been a deliberate attempt to mislead Parliament.

Ms Killian said that more information on the two documents was required.  She asked what the implications were of a performance contract that had not been properly signed by both the Director-General and the Minister.  Despite the advice given to the Director-General, the existence of a contract of questionable validity could be regarded as a reckless practice in the office of the Director-General.  The letter dated 11 July 2012 (“Annexure H3”) clearly indicated that there was a difference in the content of the version signed by the Director-General and the version signed by the Minister.  She understood that the decision on whether or not performance bonuses were paid to an official was based on whether or not the goals in the performance agreement were achieved.  If the performance agreement contract between the head of the Department and the Minister was under question, the performance management of the entire Department was compromised.  She asked if it was common practice in the public service for the Director-General to draft her own performance agreement and to submit it to the Executive authority for signature.  If this was common practice, there was cause for serious concern over performance management within the public service.  She asked for clarity on an e-mail from the office of the Director-General to the Minister on 17 October 2012 (“Annexure F2”).

Ms Tsebe felt that Members should not ask questions on the documents provided to the Committee before Members had the opportunity to study the material.  She asked why two separate documents were signed.

Ms Killian responded that she had noticed obvious problems when glancing through the documents.

Mr Schneemann agreed that the Committee needed more time to study the documents.  A quick perusal of the documents revealed a number of other issues that needed to be clarified.  The Committee only needed to establish if there was a valid contract at the present time.  He suggested that the meeting was adjourned and reconvened after Members had the opportunity to study the information provided.

Ms Muthambi asked for a response from the Director-General on why there were two different versions of the performance agreement.

Mr Kekana agreed that Members needed more time to study the documents.  He asked that the matter was concluded by the Committee as soon as possible.  Ministers had agreed objectives with the President and the performance agreements with subordinate officials should reflect the objectives of the Executive.

Ms Morutoa said that the bottom line was whether there was a valid performance contract in place.  She was not convinced that two individually signed documents that differed in content could be regarded as a valid contract.  She agreed that Members needed more time to study the documents.

Ms Sekese advised that it was common practice for an official to draw up the draft performance agreement.  A meeting with the superior officer was then held.  The performance agreements of the heads of Departments were aligned with the strategic plan of the DOC.

Ms Morutoa said that the response of the Director-General did not answer Members’ questions.  The contents of the two documents differed and could not be a valid performance contract.

Ms Ndabeni confirmed that officials in the public service drafted their own performance agreements, which were based on the objectives and strategic plans for the relevant department.  The superior officer was responsible for approving and signing the agreements of subordinate officials.  The performance agreement was considered to be valid only once both parties had signed the agreement.

Ms Sekese had no further comment.

The Chairperson wanted to know why the information had not been provided to the Committee during the previous meetings.

Ms Sekese replied that she had understood that the meeting on 16 October 2012 was convened to finalise the 2011/12 annual report of the DOC.  She had not been prepared to respond to questions about her performance agreement for the following year.

The Chairperson said that there was no valid performance agreement between the Director-General and the Minister in place.  He disagreed with the legal opinion provided by Senior Council to the Director-General.  There were two separate documents that differed in content.  Neither document was signed by both parties to the agreement.  The Director-General had informed the Committee that the legal advice given to her had been verbal.  Senior Counsel had given a legal opinion on the validity of the performance contract.  At issue was whether or not the Director-General had misled Parliament.  The Director-General had been given an opportunity to respond to questions from the Members.  Members were not necessarily satisfied with the answers to their questions.  The Committee would request the Parliamentary Legal Adviser to give a legal opinion on whether two separate documents with differing content, each signed by only one of the parties constituted a valid contract.  He agreed to requests from Members for a short break in the proceedings.

Advocate Charmaine Van der Merwe, Parliamentary Legal Adviser joined the proceedings.  She explained the basic principles of contract law.  A contract was essentially the meeting of minds between two or more people.  There must be consensus between the parties to the contract.  Basically party A made an offer to party B.  Party B could accept the offer, reject the offer or make a counter-offer.  If party B made a counter-offer, the contract was changed.  The parties then entered into negotiations.  Unless party A accepted the counter-offer there was no contract.  Performance agreements did not require formality.  A written performance agreement was not a legal requirement and need not be signed by the parties.  Such agreements could be verbal but public service policy required a performance agreement to be in writing.

In this case, the Director-General had drafted a performance agreement, signed the document and sent it to the Minister.  The Director-General had therefore made an offer to the Minister.  The Minister had made a counter-offer and signed an amended document.  An agreement and a contract could only exist if the Director-General had also signed the amended document to indicate her acceptance.  The fact that there were two different documents, each signed by only one of the parties indicated that there was not consensus between the parties and a meeting of the minds did not occur.  For a valid contract to exist, both parties had to accept identical terms.  The other party had to be advised that the terms had been accepted by signature.  In her opinion, there was no valid performance contract between the Director-General and the Minister.

It was possible that there had been an infringement of the Powers, Privileges and Immunities of Parliament and Provincial Legislatures Act (the “Powers and Privileges Act”).  Ignorance of the law was not a legal defense.  The Director-General could have understood that she had a performance contract.  The communication from the Director-General to the Minister on 11 July 2012 to discuss and formalise the performance agreement indicated that the mindset at that date was that there was no agreement.  The Committee would decide on appropriate action in accordance with its oversight responsibilities.  The Committee could lay a criminal charge against the Director-General in terms of the Powers and Privileges Act at the South African Police Service (SAPS).  Alternatively, the Committee could or refer the matter to the Minister, indicate its extreme concern and request the Minister to take action.

Ms Shinn said that the legal advice given by the Parliamentary Legal Adviser was clear.  The Director-General was aware on 16 October 2012 that the validity of her performance agreement was being disputed and that a valid contract was not in place.  She had been allowed ample opportunity to provide and explanation to the Committee.  In her opinion, the Director-General had misled the Committee.  The Committee would decide what action had to be taken.

Ms Tsebe suggested that the Committee referred the matter to the Minister and requested that action was taken.  Ms Morutoa agreed.

Mr Steyn said that there were two issues.  The Committee had to decide what action had to be taken on the misleading of Parliament by the Director-General.  The second issue was that the Minister was a party to the performance contract.  In his opinion, the Minister was also guilty of dereliction of duty for not ensuring that a valid performance agreement was in place.  It was not clear what was being referred to the Minister.

Ms Tsebe said that the matter referred to the Minister was the misleading of Parliament by the Director-General.  The Committee had given the Director-General ample opportunity to respond to the allegation.  It was clear that no performance contract had been in place.

Advocate Van der Merwe said that the Committee should inform the Minister that the Director-General had made incorrect and unqualified statements to the Committee.  The Committee regarded the matter in a serious light and requested the Minister to act.  The role of the Minister in the performance contract was another matter.

The Chairperson said that the Committee would follow the legal advice provided by the Parliamentary Legal Adviser.  Laying a criminal charge was a drastic step and the matter would be referred to the Minister instead.  The Committee would request the Minister to report on the progress that had been made.  Depending on what action had been taken, the Committee would decide if further steps were necessary.  The responsibility of the Minister regarding the performance agreements of the officials in her portfolio was a separate matter.  Ms Shinn had written to the Committee to suggest that more attention was paid to the DOC.  The Committee needed to ensure that the DOC functioned well but the focus had been on the State-owned entities in the communications portfolio rather than on the Department.  He thanked the Director-General for appearing before the Committee.  Her expression of respect for Parliament and her commitment to appear before the Committee had been noted.  He thanked the Deputy Minister for her participation.  The Committee took the matter seriously and the action taken must not be taken personally.  Public service officials must have performance agreements in place so that service delivery could be improved.

Other Committee business
The Chairperson advised that a copy of a communication from Telkom to the Independent Communications Authority of South Africa (ICASA) had been received by the Committee.  Telkom had requested a progress report on what action had been taken in the matter concerning the allegation that information had been leaked by an ICASA Councilor.  The Committee had been copied with the correspondence because it was responsible for conducting oversight over ICASA and for ensuring that the ICASA Act was enforced.  At this stage it was not clear if the matter would be brought before the Committee.

The closing date for nominations for the position of chairperson of the Media Development and Diversity Agency (MDDA) was Friday, 9 November 2012. The Committee would consider the nominations and compile a shortlist of candidates for interview.

The Committee’s programme for the fourth quarter of 2012 would be amended to accommodate briefings on digital migration and the Digital Terrestrial Television (DTT) programme on 27 and 28 November 2012.  Public hearings on the cost of communications were scheduled for 29 November 2012.  The first week of December was devoted to provincial oversight matters.  Consideration and adoption of the amended Committee programme was postponed.

The meeting was adjourned.